Revenue Leakage

What is Revenue Leakage?

Revenue leakage refers to the loss of revenue due to errors, inefficiencies or uncollected amounts in billing and revenue recognition processes. Identifying and addressing revenue leakage is vital for maximizing profitability and ensuring accurate financial reporting. Common causes of revenue leakage include invoicing errors, pricing discrepancies, contract management issues, payment processing problems, missed billing opportunities and fraudulent activities.

To prevent revenue leakage, businesses should implement robust billing systems, conduct regular audits and establish clear processes for revenue recognition. By addressing the root causes of leakage, companies can improve their financial performance and accurately capture and report all earned revenue.